rate. We reconcile the two approaches by introducing risk aversion and risk-neutral probabilities. We show that if the …

and probabilities are adjusted for risk, the two approaches are identical. What we would wish a reader to take away from …

a richer risk attitude than that captured in the standard discounted expected utility model. I derive three models that … permit a more comprehensive risk evaluation. These preference representations differ regarding the consistency requirements …

, in the absence of any risk-sharing scheme. We consider an economy in which the initial consumption level and the … distribution of consumption growth are heterogeneous. The benchmark case is when inequalities are permanent and relative risk … aversion is constant. The discount rate is not affected by inequalities in that case. We first relax the assumption on risk …

even if the risk-free asset return is correlated with other risky assets' returns. However, equivalence fails to hold on an …